The Writing On The Wall

Even to this day, the panwallahs outside The Hindustan Times high-rise on Kasturba Gandhi Marg in New Delhi talk in animated tones about an incident that happened two years ago. Apparently, archrival Times of India had despatched a crack team of summer trainees to infiltrate the HT classifieds office. Their job: an on-the-spot-sales pitch to woo hardcore HT advertisers to try TOI classifieds instead.

Ten days of persistent poaching and the HT personnel issued a delicate warning, but to no avail. Next day, it is said that six mean-muscled goons brandishing knives appeared from the HT monolith, and went after the intrepid kids who were finally whisked away by a TOI security van waiting expressly for such an exigency.

These incidents are part of publishing folklore. Today, every publication is engaged in advertising warfare. For instance, a business daily would have to fight for its market share within the business daily segment, and tussle it out with general newspapers for the business category at the same time. Besides, theres also the division of the cake between newspapers and magazines to contend with. That still leaves the formidable electronic media onslaught that needs to be factored in.

The terrestrial fight

The entry of satellite television in the early nineties had sent paranoid publishers scurrying back to their drawing boards. Doubts were being raised about the very existence of print media. Television, as expected, has made a major dent in revenue by taking away all consumer softs advertising. But print medium has withstood the challenge on all other fronts, says Satish Mehta, a consultant.

There is all round optimism in the industry. Although television advertising is growing by 40 per cent as compared to 15 per cent for press, a slow but sure increase in the size of the cake itself has offset most of the negative impact, says Siddartha Ray, managing director, SPA Group, a media consultancy. In other words, press revenues are growing in value terms, even as the ratios are falling. According to Pradeep Guha, director Bennett Coleman, the print ad-spend would now be around 65 per cent. It might eventually settle at 50 per cent, as in most developed markets.

Thats because the print medium scores on many fronts. These include a defined readership, firmly ingrained reading habits, credibility, and as a better vehicle for financial ads, tenders, classifieds, and consumer durables. Television gives instant gratification, is vastly superior on ad and news presentation, has a burgeoning mass audience and a wide reach. It then makes for an interesting exercise to discern the turn of events which helped print hold out against television.

What we are now witnessing in the electronic media is a realisation phase, as distinct from the earlier bowled-over phase. Advertisers knew that television was being watched; but they had no idea who was watching what at what time, says Anita Nayyar, media director of ad agency Lintas. Besides, there was no channel differentiation as audiences were programme-loyal. Like cricket was watched, whether on ESPN or Star Sports. Such clutter only made sense for FMCG advertisers who cared about reach, not about fleeting audiences, says a media analyst. Thus, savvy advertisers have been taking a fresh look at the press, which has become more clearly positioned over time, and offers them numbers.

Moreover, publications have taken on the role of enabling agencies quite seriously. With the help of new technology superior production quality, international standard paper, panoramic printing they have been providing advertisers with innovative, tailor-made avenues. So there are split runs, double covers, and even Raybans attached brochures.

The content too has changed in line with the compulsions exerted by television. Theres a dramatic increase in the use of visuals and colour. Also, with television getting into political news in a big way, newspapers have slowly reduced political coverage.

This has no doubt helped the print medium. According to N P Singh, executive director of Living Media, a Time magazine study has shown that their circulation is directly related to the curiosity generated by increasing news coverage on television. People want to check out in print what they see on television. It is almost like watching a cricket match in the stadium while listening to the commentary, he says.

Despite such occasional bouts of euphoria, industry players are only too conscious of the damage television has wrought. The first casualties have been the second-rung publications in each segment. You have to be no.1 in your segment to survive. Television has made life miserable for smaller publications, says Gopi Menon, media director, Chaitra Leo Burnett.

This pressure on bottomlines is leading to a consolidation in the industry. The strong are getting stronger; the weaker ones are being weeded out. According to Guha, magazines except business magazines which get a fair share of corporate advertising will be hit the hardest,as they aim at a leisure audience. Newspapers, on the other hand, are considered more a serious necessity in daily life.

The siege within

The story doesnt end with the terrestrial medium. For advertising, theres also the next-door publication to contend with. The big English dailies act as entry deterrents for new players. By not passing on the increasing newsprint cost to readers in the eighties for fear of losing circulation, they ended up heavily subsidising them, making it nearly impossible for new entrants to attain critical mass quickly, as they are caught in the vicious circle of low-circulation, no-ads, says Ray.

So, how does a late entrant break these shackles? According to sources, The Asian Age has been able to penetrate Calcutta by bleeding over Rs one crore a month. You need very deep pockets to bear continuous losses for five to seven years. And then play on strategy, says a marketing manager of leading business daily.

A favourite tool has been price cuts. A drop in price is a catalyst for trial; you need to create some excitement to be noticed, says Deepak Shourie, publisher, Outlook. But you also need to add substantial value to the product for the public to jump at it after a price cut, says N P Singh. Like the Business Today circulation is said to have jumped by 60,000 during the three months that it was offered at an invitation price of Rs 10.

However, publishers admit that a price cut as a promotional tool is probably most effectively employed by market leaders. Others have to back it up with a strong strategy punch. Ray cites TOIs persistent nibbling at HTs marketshare as a benchmark case. An important step was the introduction of Saturday Times as the first glossy broadsheet, offering a superior colour option to advertisers. As HT provided no such avenue, colour ads of lifestyle products came to TOI, recounts Ray. And, there was far more money spent on TOIs sesquicentennial celebrations in Delhi than in Mumbai. TOI was the leader in Mumbai anyway, but in Delhi, in accordance with brand management theory, TOI tried to at least capture the mind share, if not the market share, he adds.

HT retaliated by cloning the number two. It usually happens the other way round. But HT saw more mileage in quietly following TOI moves, which ensured that they wouldnt lose their readers to TOI, explains Ray.

Another tactic followed by market leaders is to artificially hike up ad tariffs. As the market leaders rates are high, it barely leaves anything for even the number two in that segment. This is exactly the strategy that TOI (Mumbai) follows, ruining the finances of the Indian Express, says a media analyst.

There are other restrictions on the laggards. Most secondline papers have to adopt an anti-establishment stance, as the top publication is usually pro-establishment. Its simply a question of alignment to market dictates. On the other hand, leaders amongst regional and vernacular papers have to adopt a firebrand anti-establishment character as their readers relate to government bashing and sensational exposures.

So, what does the future hold? With approximately 20 media houses worth naming, 20 big advertisers who constitute around 50 per cent of total ad-spend, the industry is just ripe for cartelisation, he propounds. Already, there seems to be a tacit collusion between media buying agencies. Agencies have been hammering down ad-rates in concert through block bookings and combined rates.

In retaliation, media houses too will have to form coalitions and start cooperating with each other, says Mehta. According to him, even cross-media alliances cannot be ruled out. Interestingly, the biggest threat to media could be the internet, feels Ray. No wonder, savvy media houses are falling over each other to launch online editions.

With the help of new technology superior production quality, international standard paper, panoramic printing the print media has been providing advertisers with innovative, tailor-made avenues.